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Dhaka Tribune

Shutdown breaks supply chain, business confidence

Update : 10 Nov 2013, 08:45 PM

It seems less likely that the government would be able to business confidence of the businessmen in the wake of the opposition-called 84-hour-long shutdown which disrupts supply chain management.

The decline in supply of essentials to markets would heavily weigh on spending, inflation and economic growth, official sources said.

The finance division in its efforts to maintain a smooth supply of essentials during shutdown took a number of steps including market management and regular market monitoring during shutdown.

 A senior official of the Finance Ministry who is also on fiscal coordination council committee said tomorrow’s meeting would discuss supply chain issue.

Deputy Secretary to the Finance Ministry Rehana Parvin on May 3 issued a letter to the Commerce Ministry asking what measures were taken to keep a good supply chain during hartal.

The Commerce Ministry came up with its reply that it had instructed all ministries including Home Ministry and divisions and district commissioners to take needful steps.

But during the long-hour hartal, these directives hardly worked, said an official of the ministry concerned.

According to a UNDP report, because of disruption in supply chain during shutdown the prices of essentials increase by 12%.

As per the Bangladesh Bureau of statistics (BBS), the average inflation fell by 0.10% from 7.03% in October.

In last month, food inflation rose from 0.45% to 8.38% while it was 7.93% in September.

The World Bank, IMF and Asian Development Bank have already expressed their concerns that the impending street agitation in the run-up to the national election would take a heavy toll on the economy and its growth.

They estimated that the country’s GDP would remain below 6% in the current fiscal although the Finance Ministry expected the GDP to grow by 6.6% compared to 6.3% in the previous fiscal.

The government has a budgetary target of achieving 7.2% GDP growth in the current fiscal.

Sources in the ministry said Prime Minister Sheikh Hasina also asked her cabinet members, high officials and different agencies of the government to take cautionary measures following political impasse affecting economic growth.

Shamsul Alam, a member of General Economics Division (GED) told the Dhaka tribune the coordination council meeting would not be able to build confidence in the businessmen and consumers.

It would only issue directives on how to maintain a good supply chain, he added.

The GED member further said the country’s farmers or producers and consumers were hard hit by the long-time shutdown.

The prices of the essentials decline in the rural areas where those are produced while in the urban areas their prices rise.

Onion Importer Abul Aziz petitioned the Ministry of Home for security to carry 1500 tonnes of onion imported from Myanmar, but the Home and Commerce Ministries did not respond to his prayer.

The market-monitoring team fails to visit the city kitchen market because there is shortage of policemen, said a Commerce Ministry official.

Nirod Barun Saha, president of Rice Dealers’ Association of Naogaon told the Dhaka Tribune, “We have no choice but to observe hartal one day earlier than when it is enforced.”

In general, a total of 1,000 trucks come to Dhaka carrying rice and different types of vegetables, but the number of goods carriers comes down to only 100, he pointed out.

Prices of rice and vegetable increase by five to fifteen taka during Hartal period, added the dealer.

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